China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

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China/Asia TMT

Shawn Yang

Equity Bottom-Up

<ul>
<li>SE reported C4Q22 total revenue 10% and 14% higher than our est. and cons., thanks to the improvement in monetization rate of eCommerce segment. </li>
<li>We expect the weak trend to continue into 2023, with intensified competition from eCommerce competitors and weak performance of Free Fire.</li>
<li>We raise our TP to US$62, which implies 2.5X PS/6X PE/4X PS for eCommerce/gaming/fintech in 2023. Maintain SELL rating due to challenging growth outlook. </li>
</ul>


SE reported C4Q22 total revenue 10% and 14% higher than our est. and cons., thanks to the improvement in monetization rate of eCommerce segment. 
We expect the weak trend to continue into 2023, with intensified competition from eCommerce competitors and weak performance of Free Fire.
We raise our TP to US$62, which implies 2.5X PS/6X PE/4X PS for eCommerce/gaming/fintech in 2023. Maintain SELL rating due to challenging growth outlook. 


[Sea Limited (SE US) Target Price Change]: Expect Weak Growth Trend into 2023